Boeing falls 9.6% as the 737 Max ramp slips to late 2027, with the commercial unit losing 6.5% on sales

Boeing (BA) shares were down $18.07, or 9.6%, at $170.25 in Nasdaq's quote data at 11:50 AM ET Tuesday, from a $188.31 close on Monday. The trigger was not the quarter's headline numbers. It was the timetable: CEO Kelly Ortberg said on the earnings call that Boeing is targeting 52 737 Max a month in the second half of 2027, and that stabilizing production is taking "a little bit longer" than expected because wing output is slower than planned, CNBC reported.

What Boeing reported

In its third-quarter release, Boeing posted revenue of $24.2 billion, a GAAP loss of $0.26 a share and a core (non-GAAP) loss of $0.34. Operating cash flow was $1.5 billion and free cash flow $0.5 billion, after about $0.7 billion of Department of Justice settlement payments. Cash and marketable securities came to $20.7 billion, with a $10.0 billion credit line undrawn. CNBC reported the loss per share was bigger than analysts expected, while revenue beat.

Total backlog reached a record $745 billion, including more than 6,300 commercial airplanes valued at $612 billion. Boeing delivered 161 airplanes and booked 300 net orders.

The number behind the number

Two margins explain the quarter better than the loss per share.

• Commercial Airplanes: revenue of $10.7 billion at an operating margin of negative 6.5%. On our arithmetic, that is an operating loss of roughly $0.7 billion on the jet business alone. Boeing blames a weaker delivery mix, higher projected costs tied to future production-rate changes and higher supply-chain costs.
• Defense: a 6.2% margin on $7.9 billion looks healthy, but Boeing says it includes a $252 million gain on the sale of HRL Laboratories. Strip that out and operating profit is about $240 million, a margin near 3% on our math.

Only Global Services, at an 18.3% margin on $5.6 billion, earned what a mature industrial business would. The backlog is the promise; the margins show how far the delivery machine is from cashing it in.

Why the ramp date matters more than the quarter

Boeing says the 737 is progressing toward a stabilized 47 a month, and the 787 holds at 8 a month. The 777X remains on track for first delivery in 2027. Because most of an aircraft's price is paid on delivery, as CNBC noted, every month the 737 sits below the rate it was built to reach is cash that arrives later. Moving the significant ramp to the second half of 2027 pushes back the point at which the new certifications for the 737-7 and 737-10 can turn into volume. We covered those in our report on the 737-10 approval.

Who it hits

Airlines waiting on 737 deliveries, especially those counting on the larger 737-10, now plan fleets around a slower supply of new jets. That is our inference, not something Boeing or the carriers said Tuesday. The company's own words are limited to its production targets.

For traders, the relevant points are in the filing: the next scheduled datapoints are monthly delivery counts and the 737 rate, which will show whether the 47-a-month plateau holds. The Navy's F/A-XX fighter selection, which Boeing says is not yet in backlog pending the source selection review, is the other swing factor.

Sources: Boeing; CNBC; quote data via Nasdaq at 11:50 AM ET, which may be delayed. This is market information, not investment advice.